HARRISBURG – Budget Secretary Mary Soderberg certified that nearly $770 million in gaming revenue will be available for property tax relief in 2009, marking the second year of broad-based property tax relief for Pennsylvanians.
“As Governor Edward G. Rendell announced on Monday, we are able to provide the same level of property tax relief that homeowners received in 2008,” Soderberg said. “This is good news for Pennsylvanians who are struggling to pay monthly bills while coping with the effects of the national economic downturn. It is especially welcome news for older Pennsylvanians living on fixed incomes.”
The 2006 Taxpayer Relief Act created the Property Tax Relief Fund as a way to use gaming revenue to reduce property taxes for homeowners. State law requires the budget secretary to certify the actual balance in the fund on April 15 each year and to project gaming revenues to the fund in the next six months.
Soderberg certified today that the balance in the Property Tax Relief Fund is $561.7 million, including $105.2 million in the Property Tax Relief Reserve Fund. Gaming revenue from now through Oct. 15 is projected to add $298.9 million to the relief fund, bringing the total amount in the fund to approximately $860.6 million (including the reserve fund).
Nearly 2.7 million Pennsylvania households saw their property taxes lowered in 2008 because of gaming revenues. The average statewide property tax reduction for each household is expected to be nearly $200 again this year. Final figures will be provided in early May, when counties report the number of homeowners who have signed up for their share of property tax relief. School districts will receive their share of property tax relief in two equal installments in August and October.
Homeowners in 66 counties will receive reductions in the school property tax bills they will receive this summer. Philadelphia’s share of funding for broad-based tax relief – $86.3 million in the coming year – will be used to reduce the city’s wage tax instead of its property tax, since the wage tax is the greater barrier to economic growth in that city.
Older Pennsylvanians in particular will benefit from the commonwealth’s use of gaming revenues to provide property tax relief. Nearly 580,000 seniors will be eligible for additional relief through the state’s Property Tax/Rent Rebate Program. Approximately 110,000 older adults will pay no school property taxes again this year, thanks to state-funded property tax relief. Many more will receive rebates of up to $975, in addition to the property tax relief that all homeowners receive.
The 2006 Taxpayer Relief Act dramatically expanded the Property Tax/Rent Rebate Program. Before the expansion, approximately 310,000 older Pennsylvanians benefited from the program. Under the Property Tax/Rent Rebate Program, older families with incomes up to $35,000 are eligible for rebates of up to $975, including additional relief for seniors who pay a large share of their income in property taxes or who live in high property-tax areas. Those eligible have until June 30 to sign up for the program by calling 1-888-222-9190.
Soderberg notified Secretary of Education Gerald Zahorchak by letter of the results of her certification. The amount of property tax relief will vary by school district, and the Department of Education will notify each school district of its specific level of property tax relief in early May. Under the law, Pennsylvania homeowners will see the property tax reduction itemized on their tax bill, which most school districts will issue this summer.
The amount of property tax relief in each school district will be available online in early May.